Hayden High School sophomore Kole Miner practices welding Thursday in the Babson Carpenter Career and Technical Education Center. If passed, Sen. Michael Johnston's school finance bill is expected to send more state funding to the Hayden and South Routt school districts.

Major school finance bill a mixed bag for Routt County educators

Mason Remington participates in a math lesson Thursday at Hayden Valley Elementary School. The Hayden School District is expected to receive more state funding under Sen. Michael Johnston's proposed school finance bill.

Steamboat Springs  As educators in the Steamboat Springs School District continue to greet with apprehension a school finance bill unveiled this week in Denver, the leaders of Routt County's other two public school districts are much more optimistic about the legislation.

“It would be a huge benefit for us,” South Routt Superintendent Scott Mader said about state Sen. Mike Johnston’s proposed changes to the finance formula that could increase South Routt’s share of state funding by hundreds of thousands of dollars. “It would definitely put us in a better position with our budgets.”

Mader added that the district still is suffering from budget cuts and has staff and capital needs.

And in Hayden, the bill could mean an infusion of state funding before the expiration of an existing mill levy override that nets the school district about $324,000 annually.

“We're pleased with anything that would provide more money for education,” Hayden Superintendent Mike Luppes said. “It sounds like (this bill) would offer a nice increase in funding for our district.”

Johnston, D-Denver, on Monday released the 144-page draft of his bill that will seek major changes to how schools in the state are funded.

Although Johnston's bill aims to increase state funding to a vast majority of districts across the state, it could spur the Steamboat Springs School District, and more than 20 other districts with higher median incomes and property values, to seek more funding from local taxpayers to offset a reduction in state funding.

A financial analysis of an early draft of the bill showed it could cut Steamboat's portion of state funding by $2.2 million.

Johnston's Chief of Staff Damion LeeNatali said Thursday night that the financial runs were preliminary and that the official estimates of the bill's financial impact on each of the state's 178 school district's soon will be released.

The senator told the Steamboat Today earlier this month that his bill aims to fix a funding formula that allows some school districts in the state with very high property values and median incomes but low mills to receive a significantly higher amount of state funding than other communities that are taxing themselves at a higher rate but receiving far less from the state.

Districts wouldn't lose any state funding under the new formula until 2020, according to the draft bill.

“I applaud Sen. Johnston and his commitment to this bill, but I still have a number of questions and concerns about where these policies will lead,” Colorado Rural Schools Caucus Executive Director Paula Stephenson said Thursday.

She told the Steamboat Springs School Board earlier this month that she wouldn't support a piece of legislation that negatively impacted any one of the more than 100 rural districts she represents.

Although some aspects of Johnston's bill concern educators here in Steamboat, there are pieces of his legislation that earn widespread praise in Routt County.

The senator's push to provide more state funding for full-day kindergarten programs is a welcome proposal, especially in Steamboat, where parents have had to pay tuition or seek scholarships for the service.

And the bill also will look to revamp how districts report students numbers for funding purposes. Instead of having students counted only Oct. 1, Johnston is proposing averaging the count data from four days in a school year. That would allow districts to receive funding for students who arrive after the count date in the fall.

“This version is probably better than the first one we were looking at, but it still needs some work,” Steamboat School Board President Brian Kelly said Thursday about the draft of the bill released Monday.

If the bill passes, it wouldn't kick in unless voters in Colorado approve additional funding for education, a feat Luppes and other educators here acknowledge will be a challenge after the overwhelming failure of the last proposed statewide tax increase for education.

Luppes added that it was too early to get too excited by the bill and its proposed changes or to get too pessimistic.

“Obviously, there's a long way to go with it, including a public vote on increasing taxes,” he said.

Johnston will hold a public forum on the bill next week in Denver. Community members can read the bill and offer feedback to Johnston at www.mikejohnston.org.

Stephenson said she expects the bill will be introduced as early as next week in the state Senate with a targeted passage in mid-March.

Comments

Scott,
Trying to read between the lines, and not being too familiar with the the current school funding formula, am I hearing that RE-2 residents may be paying lower property taxes in relation to property value than those paying taxes in other districts with lower property values? Of course, Routt residents and our visitors also pay the 0.5cent sales tax for the Fund Board monies. It would be interesting to try to compare the overall tax burden of the Routt County resident in each of the three districts SOROCO, Steamboat, and West Routt (factoring in the sales tax) in comparison to other areas in the state in terms of: overall burden, as a percentage to their property value, and as a percentage of median income. You have mentioned severance tax a few times and how that plays into the funding mechanism. Would this new bill pull more severance tax away from the counties that it is intended to compensate for energy impacts?

First off, Fund Board funding is not part of the state's calculations. In theory, Fund Board is not part of the SSSD and could give it's money to local private schools or Soroco and Hayden instead of SSSD..

SSSD charges mill levies of about 17.2, Soroco is 36.5 Hayden is 29.6. Since the assessed value of property in SSSD is about 8 times that of Soroco or Hayden then it appears that SSSD local property tax revenues per student is about the same as for Soroco and Hayden.

The Colorado Dept of Education has a 17 page document on Understanding Colorado School Finance and Categorical Funding which never mentions any formula based upon a district's income. There is one paragraph talking about a 27 mill levy and local share. And the State Legislature has a 48 page pamphlet that never mentions high income or any clarification of the claimed low mill problem of wealthy districts.

As for policy implications, on one hand it can be argued that a wealthy district like SSSD should be contributing more local funding per pupil than less wealthy districts. On the other hand, most of the money for school financing comes from the State from state taxes and the residents of wealthy districts like SSSD are paying more in state taxes than those in less wealthy districts and so SSSD residents are already contributing to the less wealthy districts via state funding.

I think an unintended consequence if this change in state funding bill passes would be to put SSSD's accepting of Soroco and Hayden students into question. Under the current funding rules, SSSD gets a good chunk of money per student it accepts from outside the district. So SSSD can say the open enrollment policy isn't significantly impacting SSSD residents.

But if new funding law requires wealthy districts to locally provide more funding then transfer students become added costs without much additional revenue. So then SSSD residents would be asked to reduce the funding available for their students in order to accept out of district students. When over 10% of students in Hayden and Soroco instead go to SSSD then that become an explosive local issue.

Arguably, student transfers work for the local school districts. Sure Soroco and Hayden don't get state funding for their students going to SB schools, but it leaves more local funding available per remaining student. Meanwhile, SSSD gets enough state money for the transfer students that SSSD can argue it covers the incremental cost of adding students. And the transfer students also work politically since Stagecoach parents don't press Soroco for a local school since they bring their kids to SB schools near their job; and Hayden parents concerned with the districts poor middle and high school standardized test scores can just take their kids to schools without those problems.